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Liquidmetal Technologies Reports First Quarter 2016 Results

RANCHO SANTA MARGARITA, Calif.--(BUSINESS WIRE)--May 10, 2016-- Liquidmetal® Technologies, Inc. (OTCQB: LQMT), the leading developer of amorphous alloys, reported results for its first quarter, ended March 31, 2016.

Q1 2016 Operational Highlights

On March 10, 2016, Liquidmetal Technologies, Inc. (the “Company”) entered into a Securities Purchase Agreement with Liquidmetal Technology Limited, a Hong Kong company (the “Investor”), providing for the purchase of up to 405,000,000 shares of the Company’s common stock for an aggregate purchase price of $63.4 million. Investor is a newly formed company owned by Mr. Yeung Tak Lugee Li (“Mr. Li”). On March 10, 2016, Investor purchased 105,000,000 shares for an aggregate purchase price of $8.4 million. The purchase of the remaining 300,000,000 shares for $55 million is anticipated by August 17, 2016.

Also on March 10, 2016, the Company and DongGuan Eontec Co., Ltd. (“Eontec”) entered into a parallel License Agreement to cross-license their respective technologies. Eontec is a publicly held Hong Kong corporation listed on the Shenzhen Exchange, of which Mr. Li is the Chairman and majority stockholder. Eontec is engaged in the business of precision die-casting but has aggressively extended its research and development activities to include the manufacture of bulk metallic glass in recent years.

“We are very excited about the potential synergies between LQMT and EONTEC as we seek to develop and grow the market for Liquidmetal on a global basis. I look forward to providing an additional update to shareholders, beyond the call we had on March 16, 2016, on the progress of this transaction during our shareholder meeting on May 19th,” said Thomas Steipp, President and CEO at LQMT.

Q1 2016 Financial Summary

In Q1 2016, the Company generated revenues of $168 thousand as it continued to focus on the development of prototype and commercial parts for its customers and partnering with licensees on the development of the Company’s technology and production processes.

Selling, marketing, general and administrative expense was $2.0 million in Q1 2016, as compared to $1.9 million in Q1 2015.

Research and development expense was $559 thousand in Q1 2016, compared to $482 thousand in Q1 2015.

Cash and restricted cash totaled $11.3 million at March 31, 2016, as compared to $4.7 million at December 31, 2015.

About Liquidmetal Technologies

Rancho Santa Margarita, California-based Liquidmetal Technologies, Inc. is the leading developer of bulk alloys that utilize the performance advantages offered by amorphous alloy technology. Amorphous alloys are unique materials that are distinguished by their ability to retain a random structure when they solidify, in contrast to the crystalline atomic structure that forms in ordinary metals and alloys. Liquidmetal Technologies is the first company to produce amorphous alloys in commercially viable bulk form, enabling significant improvements in products across a wide array of industries. For more information, go to www.liquidmetal.com.

Forward-Looking Statement

This press release contains “forward-looking statements,” including but not limited to statements regarding the advantages of Liquidmetal’s amorphous alloy technology, scheduled manufacturing of customer parts and other statements associated with Liquidmetal’s technology and operations. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could vary materially from Liquidmetal’s expectations and projections. Risks and uncertainties include, among other things; customer adoption of Liquidmetal’s technologies and successful integration of those technologies into customer products; potential difficulties or delays in manufacturing products incorporating Liquidmetal’s technologies; Liquidmetal’s ability to fund its current and anticipated operations; the ability of third party suppliers and manufacturers to meet customer product requirements; general industry conditions; general economic conditions; and governmental laws and regulations affecting Liquidmetal’s operations. Additional information concerning these and other risk factors can be found in Liquidmetal’s public periodic filings with the U.S. Securities and Exchange Commission, including the discussion under the heading “Risk Factors” in Liquidmetal’s 2015 Annual Report on Form 10-K.

 
LIQUIDMETAL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except par value and share data)
 
      March 31,       December 31,
2016 2015
(Unaudited) (Audited)

ASSETS

 
Current assets:
Cash $ 10,287 $ 2,773
Restricted cash 1,005 2,008
Trade accounts receivable, net of allowance for doubtful accounts 102 30
Inventory 152 83
Prepaid expenses and other current assets   224     408  
Total current assets $ 11,770 $ 5,302
Property and equipment, net 1,263 1,370
Patents and trademarks, net 568 570
Other assets   36     31  
Total assets $ 13,637   $ 7,273  
 

LIABILITIES, REDEEMABLE COMMON STOCK, AND SHAREHOLDERS' (DEFICIT) EQUITY

 
Current liabilities:
Short-term debt 700 700
Accounts payable 209 250
Accrued liabilities 1,246 947
Deferred revenue - 77
Option liabilities   5,550     -  
Total current liabilities $ 7,705 $ 1,974
 
Long-term liabilities:
Warrant liabilities 2,388 59
Other long-term liabilities   856     856  
Total liabilities $ 10,949 $ 2,889
 
Redeemable Common Stock:

Common stock, $0.001 par value; 105,000,000 and 0 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively (Note 14).

7,129 -
 
Shareholders' (deficit) equity:

Preferred Stock, $0.001 par value; 10,000,000 shares authorized; 0 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively

- -

Common stock, $0.001 par value; 700,000,000 shares authorized; 477,149,485 and 477,149,485 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively.

477 477
Warrants 18,179 18,179
Additional paid-in capital 204,088 203,735
Accumulated deficit (227,121 ) (217,945 )
Non-controlling interest in subsidiary   (64 )   (62 )
Total shareholders' (deficit) equity (4,441 ) 4,384
   
Total liabilities, redeemable common stock, and shareholders' (deficit) equity $ 13,637   $ 7,273  
 
 
LIQUIDMETAL TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except share and per share data)
(unaudited)
 
      For the Three Months Ended
March 31,
2016       2015
 
Revenue
Products $ 165 $ 23
Licensing and royalties   3     3  
Total revenue 168 26
 
Cost of sales   158     19  
Gross profit 10 7
 
Operating expenses
Selling, marketing, general and administrative 2,017 1,852
Research and development   559     482  
Total operating expenses   2,576     2,334  
Operating loss (2,566 ) (2,327 )
 
Change in value of warrant liabilities, loss (1,569 ) (161 )
Change in value of option liabilities, loss (5,039 ) -
Interest expense (4 ) -
Interest income   -     8  
 
Net loss and comprehensive loss (9,178 ) (2,480 )
 
Net loss attributable to non-controlling interest   2     2  

Net loss and comprehensive loss attributable to Liquidmetal Technologies shareholders

$ (9,176 ) $ (2,478 )
 

Net loss per common share attributable to Liquidmetal Technologies shareholders, basic and diluted

$ (0.02 ) $ (0.01 )
 
Number of weighted average shares - basic and diluted   512,149,485     464,482,819  
 

Source: Liquidmetal Technologies, Inc.

Liquidmetal Technologies, Inc.
Otis Buchanan, 949-635-2120
Media Relations
otis.buchanan@liquidmetal.com